Byrd has been very active promoting the proposed ordinance, which would require lenders to register with the city, limit how much customers can borrow and how many times they can renew a loan.

It would limit payday loans to 20 percent of the borrower's gross monthly income and auto title loans to either 3 percent of the borrower's gross annual income or 70 percent of the vehicle value. The ordinance would also limit the number of installments to four and rollovers and renewals to three.

Advertisement

If approved, the ordinance would go into effect in July.

Brian Figueroa, manager of Pancho's Title Loans, said it's difficult to say how the proposed ordinance is going to impact the payday and car title loan businesses. If approved, the city's proposed regulations will cause problems in the long term for the consumers, he said, because the proposed rules will make it more difficult for customers to find loans.

Figueroa said payday and auto title loans businesses are already regulated by the state.

"We have regulatory disclosures that we have to give to the consumers. They know what the loan is when they come in for it," he said.

Several cities across the state, including Dallas, have adopted similar ordinances to help regulate payday lenders. Dallas council member Jerry Allen is expected to speak before the El Paso City Council today about the impact of a similar ordinance in his community, The Dallas' Morning News reported on Monday.